Certified Government Financial Manager (CGFM) Practice Exam 2025 - Free CGFM Practice Questions and Study Guide

The correct answer, which refers to object class controls, relates directly to guidelines that categorize expenditures based on their nature, such as salaries, supplies, or equipment. This type of control helps ensure that funds are allocated and spent appropriately according to the specific categories defined within an organization’s budget.

Object class controls establish limits on how much can be spent across these various categories, thereby promoting fiscal responsibility and accountability. By enforcing these restrictions, organizations can monitor spending more effectively, ensuring that resources are used for their intended purposes and that budgetary compliance is maintained.

In contrast, program controls focus on the effectiveness and efficiency of specific programs and projects, while financial reporting controls are aimed at ensuring accurate financial statements and reports. Performance controls assess the achievement of results against established goals, which is a different focus from the direct expenditure restrictions outlined in object class controls.